Indonesia’s market regulator is investigating the use of funds raised in an initial public offering of one of London-listed Bumi Plc ’s key assets. Bapepam, the financial watchdog, has requested data and information over several months from Bumi Resources Minerals, which in late 2010 raised about $230m through a flotation in Jakarta. BRM is a subsidiary of Bumi Resources , the Indonesian coal miner controlled by the influential Bakrie family in which the London group has a 29 per cent stake. Allegations over the BRM funds also form part of the Bumi Plc board’s probe into what it says are potential financial irregularities at its Indonesian businesses. According to one person familiar with the matter, the board was examining an allegation that $110m in IPO funds was used to back a bank loan to a special purpose vehicle, known as Blue Quartz, The Financial Times reports.
George Osborne’s austerity drive could be partly to blame for the recession, the Government’s own economic forecaster said yesterday. The independent Office for Budget Responsibility (OBR) said that “unexpectedly stubborn” inflation and deteriorating export markets are the main causes but austerity may have also played a part. “We clearly cannot rule out the possibility that the unexpected weakness of economic growth over the past two years can be explained in part by the fiscal consolidation acting as a greater drag than we had assumed,” it said in its latest forecast evaluation report, The Times says.
Germany has stated its exorbitant price for keeping Greece in the euro and agreeing to mass bond purchases by the European Central Bank. There must be an EU “currency commissioner” with sweeping powers to strike down national budgets; a “large step towards fiscal union”; and yet another EU treaty. Finance minister Wolfgang Schaeuble dropped his bombshell in talks with German journalists on a flight from Asia, and apparently had the blessing of Angela Merkel, the chancellor. “When I put forward such proposals, you can take it as a given that the chancellor agrees,” he said. Officials in Brussels reacted with horror. “If that is the demand, they are not going to get it. Nobody in the Council wants a new treaty right now,” said one EU diplomat, The Telegraph holds.
Oil giant BP has set a deadline of Thursday for all bids for its stake in TNK-BP, in a move expected to elicit offers both from its oligarch partners, AAR, and from Kremlin-controlled Rosneft. The AAR consortium has said it plans to submit a “competitive” cash bid on Wednesday, the final day in a 90-day period of “good faith” negotiations under which BP was precluded by the TNK-BP shareholder agreement from signing a deal with any other parties. But the Daily Telegraph understands that BP, which has also been in talks with Rosneft since late July, has asked for all bids from interested parties to be submitted by Thursday morning at 9am.
Nat Rothschild is “completely, 100% wrong” about the controversial “divorce” deal facing Bumi, according to the man trying to steady the troubled London coal group in the wake of the financier’s shock resignation. The former Vodafone executive spoke out after Mr Rothschild outlined his lack of confidence in the board’s ability to “do the right thing”, flagging his opposition to a £750m deal from key Indonesian shareholders, the Bakries, to sever ties with Bumi. Sir Julian said the financier was wrong to argue that agreeing to part of the deal risked creating a backdoor way for the Bakries to get all the FTSE 250 company’s assets on the cheap, The Telegraph says.
Royal Bank of Scotland is today expected to announce its exit from the £282bn state-backed insurance scheme set up when the bank was bailed out four years ago. RBS is set to make its final £1.4m payment to the Asset Protection Scheme (APS) this week, which will see it reach the £2.5bn minimum threshold to leave the emergency insurance programme. The APS was set up by the authorities in January 2009 to provide insurance cover to RBS and Lloyds Banking Group after their taxpayer-funded rescues. The scheme originally provided RBS with cover against losses on toxic assets worth £282bn, but this has shrunk over the past four years to a figure of about £100bn as the bank has sold off businesses and loan portfolios no longer considered core to its operations, The Telegraph reports.
EU regulators have demanded that Google substantially change its controversial privacy policies or risk fines, a move that threatens to slow the US search giant’s introduction of new products and advertising schemes in Europe. European privacy watchdogs said a probe led by the French regulator CNIL showed that Google failed to provide users with adequate information about how their personal data were being used across the US group’s different platforms. Isabelle Falque-Pierrotin, CNIL’s chairwoman, said that unless Google implemented the recommended changes within three to four months, the dispute would “move on to another phase, which is a sanctions phase”. Google this year introduced sweeping changes to the terms and conditions governing how it can use data about its hundreds of millions of customers – enhancing its ability to profile consumers and deliver targeted advertising, The Financial Times explains.